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Job Creation Subsidies by State Highest Ever Last Year

Ábrahám Vass 2020.01.29.

The government paid a total of HUF 105.3 billion (EUR 312 million) for job creation aid for companies last year, creating 6,686 new workplaces. This means that a workplace created with state subsidy cost HUF 15.7 million (EUR 47 thousand) on average for taxpayers, liberal HVG reported. 

Both the amount of subsidies and the average cost of a workplace is the highest ever. Aid for job creation has been increasing year to year since 2015.

The biggest beneficiary last year was partly state-owned oil company MOL, who received HUF 68 million (EUR 202 thousand) per workplace, followed by Pick Szeged (HUF 33.1 million per workplace), and IBM (HUF 32.8 million per workplace).

MOL emerged first in the absolute value of state support as well, having bagged HUF 11.7 billion (EUR 35 million) for the promise of creating 172 workplaces. It was followed by German Continental (HUF 10.6 billion for 450 workplaces), while German Rehau-Automotive got 7.1 billion.

Audi was also on the receiving end of a big deal of state support. The German car manufacturer pocketed HUF 6.4 billion (EUR 19 million) for 250 new jobs on the development of e-engine production (HUF 25.5 million/workplace).

Liberal news site 24.hu noted that not all of the state support went to multinational companies, but they were the biggest beneficiaries, as only the large companies can afford such giant investments.

In addition, government-critical Index, in reference to the European Commission’s 2017 data, notes that in comparison to GDP, Hungary spends an exceptional amount on job creation support.

In the past few years, thanks to the growing economy, the change in the government’s economic and social policies, certain “unorthodox,” debated methods such as the fostered work scheme, and the large number of Hungarians working abroad, the country has seen exceptionally good employment statistics, with the rate rising to 73% and the unemployment rate steady at around 3%.

featured image via MTI